TYNDP 2013-2022 SJWS #1Infrastructure Projects -- Supply & Demand

TYNDP 2013-2022 -- 1st SJWS 24 January 2012

ENTSOG offices -- Brussels

SJWS concept applied to TYNDP

Get a better understanding of stakeholders’ expectation> Overall targets of TYNDP provided by Regulation

• Supply adequacy assessment• Investment gap identification• Identification of barriers to investments closing the gap

> Methodology needs to be enhanced according to stakeholders’ feedback in order to meet their expectations in the most appropriate way

Ensure access to knowledge beyond TSOs’ remit> As TYNDP scope exceeds demand and transmission capacity direct input from

other stakeholders are required to face TYNDP target> Accuracy of the final report always reflects the lowest quality input, this implies

that methodological improvements can be implemented only if the related data are provided to ENTSOG

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SJWS processBuild robust common understanding> TYNDP is a thick report encompassing many topics making it difficult for non specialist

to extract the entire added-value> Continuous interaction with stakeholders during the process is key to ensure a good

readability, involvement process thus needs to be further improved> First part of the SJWS is to ensure a common understanding of previous report and

received feedback

Analyze ENTSOG initial proposals> Once common understanding will be reached, ENTSOG will release an initial proposal

for each topic to be discussed with stakeholders

Final definition of methodology and inputs> Based on the information and expectations coming from the SJWS, ENTSOG will define

the methodology and data to be used in TYNDP 2013-2022> Conclusions will be presented during June WS for final feedback prior to drafting

process

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Infrastructure projects - GeneralTYNDP scope> Current report covers:

• All types of infrastructures: transmission, LNG and UGS• Both TSOs and third-parties’ projects (regulated or not)

> To be included, project information had to be submitted through a standard questionnaire (following a public call for information)

Public call rationale> As project inclusion in TYNDP is a sensitive issue (that could increase with EIP),

transparency and non-discrimination standards are of the highest importance> Standard compliance are key when collecting data on a voluntary basis

Project clustering for modelling

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> Regarding the wide range of projects included in TYNDP and the difference in investment process within Europe (see EIP discussion), FID is perceived by ENTSOG and many stakeholders as the most relevant, transparent and non-discriminatory criteria for clustering

Infrastructure projects - What is in the TYNDPAnnex A> Most comprehensive and detailed list of gas infrastructure projects across Europe> Reference document built on project sponsors’ questionnaires

Main report: gap and remedy identification> Under each of the 67 simulations, gaps have been identified if the country

remaining flexibility was below 5% (or 1% in case of a disruption)> If a project being part of Annex A mitigates the gap, it will be mentioned along with

the gap (most of the time more than one project reduced the gap)

Annex E> As either all FID or all FID plus non-FID projects have been clustered (including

competing ones), the modeled load factor of projects in each scenario is lower than the one that could result having less projects coming on stream

> Nevertheless load factor of each individual project may be estimated using the remaining flexibility provided for projects in Annex E for most scenarios

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Submitted projects per category

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Pipes FID Non-FID

Projects 62 97

UGS FID Non-FID

Projects 26 22

LNG FID Non-FID

Projects 11 20

Total FID Non-FID

Projects 99 139

Infrastructure project questionnaire

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Nearly the same questionnaire for TSOs’ and 3rd Parties’ projects

Microsoft Word 97 - 2003 Document

Information provided within the report

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Ukrainian disruption (additional investment gaps to the Reference Case)

BG <1% Reg. Cong.

Global improvement due toAT & SK > HU

<1%

HR <1% Reg. Cong. <1%

FY <1% Reg. Cong. <1%

GR <1% BG & TK > GR <1%

HU <1% AT & SK > HU <1%

RO <1% Reg. Cong. <1%

RS <1% Reg. Cong. <1%

Total High Daily demand for the region defined by all above countries is covered by 70% with existing infrastructure plus FID and by 75% with addition of non-FID projects. Individual country’s supply demand balance cannot be assessed in this TYNDP due to the current lack of criteria.With non-FID projects (AT to HU capacity increase) remaining flexibility for Austria is inferior to one per cent but still enable to cover the whole demand.

Numerical information within main body and non-FID project load factor within Annex E

Infrastructure projects - Feedback

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Data collection & processing> Collecting process to be improved in order to ease submission by project sponsors> Cost estimation should be provided on a voluntary basis> Cost information should remain aggregated at report level> Only the information needed for modelling purpose should be mandatory> ENTSOG should have published detailed cost estimation as provided by project sponsors> More promotion in order to have more projects committed> Monitoring chapter on project progress should be added> Explanation of differences between nTYNDP and GRIPs> Interaction between TYNDP and PCI process should be explored

Project clustering> FID is a relevant and objective criteria and any additional one should be easily verifiable> Additional status could be “under construction” , “agreed but non-FID”

Existing infrastructures> More detailed information should be provided

Demand - GeneralTYNDP scope> Current report covers:

• Demand scenario coming from TSOs (best estimates)• An Average Daily Demand

• A High Daily Demand (1-in-20 in most countries)

• Annual demand scenarios coming from Eurogas, IEA and Primes• An Average Daily Demand

> Only TSOs and Primes scenarios provide data on a country basis

Methodology rationales

> TSOs scenario has been factored in network modelling under both Average Daily Demand (proxy for yearly demand) and High Daily Demand

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> As demand is used in modelling for gap identification, daily figures for each country were required

Demand – What is in the TYNDPAnnex C> Quantitative analysis and comparison of demand scenarios at European (and

national level when possible)

Main report: overall supply adequacy to demand> Comparison of TSOs demand scenario (yearly/average day picture) with potential

supply at European level> High Daily Demand comparison requires modelling as investment gaps could

prevent available supply to move to demand centres

Resilience test> Security of Supply resilience has been assessed under High Daily Demand as being

the most stressful in case of disruption or low UGS deliverability> Market integration resilience has been assessed under Average Daily Demand as

competition is measured under business-as-usual conditions

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Demand - Feedback

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Climatic criteria and alternatives> Seasonal scenarios are more meaningful than yearly ones> Additional top-down scenarios considering macro-economic indicators (population,

GDP) the implementation of environmental and energy policy and alternative fuel mixes

> Impact of intermittent renewable power generation on gas demand> Inclusion of third-countries as Norway and Turkey> Higher transparency on the (individual) TSO’s underlying assumptions> Consistent TSOs’ underlying assumptions

Comparative approach with other outlooks> Coordination with ENTSO-E needs to be ensured> Other outlooks could be also used in the modelled scenarios> Analysis would have to be developed in order to check the consistency with renewable

energy on a country-specific basis

Supply - GeneralTYNDP scope> Supply sources included in TYNDP were:

• Algeria (pipe) & Libya (pipe) from McDermott study for Commission• LNG (all sources together) from a GLE study• National Production from TSOs• Norway and Russia from national Ministries

> Gathered information was potential supply on a yearly basis

Methodology rationales> For each demand case (Average and High Daily) a supply case has to be defined to

build a Reference Case> In every resilience test scenario, supply has been kept as close as possible to the

Reference Case while minimizing potential demand curtailment or investment gap and staying within the supply potential range of each source

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> Supply mix in Reference Case is then used only to produce a reasonable scenario but has no influence on gap identification

Supply – What is in the TYNDPAnnex C> Comparison of yearly potential supply for every source

Supply under Average Daily Demand> National production is set at maximum possible level> 2011 import shares are based on 2008 and 2009 average (BP Review)> Starting in 2012, import shares are increased according to net demand (national demand

less national production) until they reach their maximum potential> In such case missing quantity is replaced by other sources

Supply under High Daily Demand> National production is set at maximum possible level> 2011 import (except LNG) are based on 2008 and 2009 daily maximum flows> Peak factor for 2011 has been defined for each import (except LNG) as the ratio between

the share on the average day and the one of the High Daily Demand day> Starting in 2012, such ratios have been applied for every source average share > UGS and LNG have been used as last resort supply to balance the demand

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Supply - Feedback

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General consideration on supply approach> Consideration of supply limitation makes scenarios more realistic> Ministerial sources could be too optimistic> Non-conventional gas should be considered> Dialogue with producers should be maintained and enhanced> Consideration of ramp-up phases> Focus should be on existing (contracted) supply and ones associated with committed

projects

Supply modelling> A 10 to 15-year average could be more relevant than 2008 & 2009 when defining

supply shares for the Reference Case> Methodology to define Reference Case supply is appropriate> The arrival of a new supply source should reduce the shares of the existing ones > Supply contractual constraints should be factored in the scenarios> More supply scenarios should be investigated

Average daily supply share – Reference Case

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GWh/d 2011 2015 2020

Demand 1000 1200 1400

National Production

Potential 300 250 200

Actual share 300 250 200

Net Demand 700 950 (+36%) 1200 (+26%)

Supply A Potential 600 700 800

Actual share 400 543 700 / 646

Supply B Potential 400 450 500

Actual share 300 407 500 / 461

Supply C (hypothetic)

Potential 0 0 0 / 100

Actual share 0 0 0 / 93

High daily supply share – Reference Case

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GWh/d 2011 2015 2020

Demand 1400 1700 2000

National Production

Potential 350 300 250

Actual share 350 300 250

Net Demand 1050 1400 1750

Supply A Average Daily 400 543 700

High Daily share 500 679 875

Supply B Average Daily 300 407 500

High Daily share 400 541 665

To be covered by UGS and LNG at same load factor

150 180 210

GWh/d Max 2008/2009 Average daily share High Daily Ratio

Supply A 500 400 1.25

Supply B 400 300 1.33

Supply by import route

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Load factor of import routes coming from other supply sources are not impacted by the new Route 3

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Thank You for Your AttentionENTSOG -- European Network of Transmission System Operators for GasAvenue de Cortenbergh 100, B-1000 Brussels

EML: info@entsog.euT: + 32 2 894 5100WWW: www.entsog.eu